Fintech trends that matter for financial services firms

Financial services has changed more in the last decade than in the fifty years before it. Customers expect instant payments, fast onboarding and help at any hour. Competitors embed financial products in places banks never reached. And regulators are paying close attention to AI, data and resilience. For established firms and growing fintechs alike, the question is which trends deserve investment now.

1. Embedded finance

Payments, lending, insurance and accounts built directly into non-financial products: buy-now-pay-later at checkout, financing inside a software platform, insurance offered with a purchase. For financial firms, it means distribution through partners. For other businesses, it means new revenue from customers they already have. The work is mostly in partnerships, integration and compliance.

2. Instant and account-to-account payments

Real-time payment systems now operate in many markets, and payments direct from bank accounts are growing as an alternative to cards. Firms that still settle in batches feel it in customer expectations and cash flow. Planning for real-time payments also means real-time fraud checks.

3. Open banking and open finance

Sharing customer-permitted data through secure connections makes faster lending decisions, account aggregation and personalised advice possible. The next wave extends this to pensions, investments and insurance. Firms that use it well onboard customers faster and lend with better information.

4. AI in fraud, credit and service

AI has been standard in fraud detection for years and is spreading:

• Fraud and financial crime: spotting unusual transactions and networks in real time, with fewer false alarms.
• Credit: using more data, such as cash flow from open banking, to assess risk, especially for thin-file customers.
• Service: assistants that answer account questions and draft replies for staff.
• Operations: reading documents in onboarding, lending and claims.
• Compliance: monitoring communications and transactions against rules.

The constraint is trust. Decisions that affect customers need explanations, fairness testing and human oversight, and credit scoring is treated as high-risk under rules such as the EU AI Act.

5. Passkeys and biometrics

Passwords and one-time text codes are giving way to passkeys and device biometrics, which are both easier for customers and much harder to phish. Combined with behavioural signals, they reduce account takeover without adding friction.

6. Regulatory technology

Automating compliance work, such as identity checks, transaction monitoring, reporting and record-keeping, reduces cost and error. Regulators increasingly expect firms to show their controls work, which favours systems that log and evidence every check.

7. Digital assets, stablecoins and central bank digital currencies

Regulation of crypto-assets and stablecoins is maturing, for example under the EU’s Markets in Crypto-Assets Regulation, and several central banks are piloting or preparing digital currencies. For most firms, the practical step is to understand customer demand and regulatory obligations before building anything; our article on blockchain sets out when the technology fits.

8. Sustainable finance

Customers and regulators want to know the climate impact of portfolios and lending. Data on emissions and sustainability claims is becoming part of reporting and product design, and greenwashing rules are tightening.

9. Operational resilience

Regulators expect firms to withstand and recover from outages and cyber attacks, including at their technology suppliers. That means mapping critical services, testing recovery and managing third-party risk. See reducing downtime with proactive monitoring.

What should a financial services firm do first?

1. Fix the data foundations. Customer, product and transaction data connected and trusted is the base for AI, personalisation and compliance.
2. Pick one customer journey with a clear cost, such as onboarding or a lending decision, and measure it.
3. Partner for standard capabilities and build only where you can differentiate.
4. Design compliance in, with logging, explanations and human review from the start.

Where to start

We help financial services firms connect their systems, put AI to work where it pays, and measure the result. See our financial services industry page, or book a 30-minute session. For marketing in regulated firms, read digital marketing for financial advisors.